A guide to buying your home

New to the home buying process? Our quick guide has all the information you need.

Do your own research

Do your own research

While the selling agent will answer a lot of your questions about a property, they are representing the seller, so it's always a good idea to do your own research, too. It will take a little time and money but is a worthwhile investment. The following documents are important sources of information:

  • Title Search
  • Land Information Memorandum
  • Property Inspection
  • Valuation report

Title Search

The title search contains all the records about the property that are held by Land Information New Zealand (LINZ). You should be able to obtain a copy of the title search from the selling agent. Otherwise, your lawyer can get one for you, or you can do your own search through LINZ. Ask your lawyer to check the property’s title before you sign anything. Find out more about title searches at LINZ.govt.nz.

Land Information Memorandum

The LIM is a comprehensive report provided by the local council containing all the important current and historical information relating to the property, such as erosion risks, rates and District Plan considerations. Either you or your lawyer can request a LIM from the council or the salesperson may provide a copy. Note that a LIM may not hold every piece of relevant information. Ask your lawyer if it is also necessary to request access to the council’s property file or ask the salesperson if they have the property file. Find your local council at localcouncils.govt.nz.

Property Inspection

It’s a good idea to select a qualified property inspector early on in your home buying process. You should choose one with professional indemnity insurance who carries out their work in accordance with the New Zealand Property Inspection Standards. They will be able to tell you if there are problems with the condition the property. You may also need an engineer’s inspection. Find a property inspector at buildingsurveyors.co.nz or boinz.org.nz, or find an engineer at ipenz.nz

Valuation Report

If you are applying for a mortgage, your lender may ask for a registered valuation to confirm how much the property is worth. The valuer will visit the house and perform an assessment. Find a registered property valuer at property.org.nz.

Get Legal Advice

Buying a property is a big investment, and if things go wrong, it can be costly. Sales and purchase agreements are legally binding, and you should seek independent legal advice before you sign anything.

How to find a property lawyer

  • Get recommendations from friends, family or work colleagues.
  • Contact the local branch of the New Zealand Law Society.
  • Find a lawyer at propertylawyers.org.nz
Do your own research
Do your own research

Understand the process

Properties can be sold in several different ways, and practices can vary between agencies. Make sure you confirm with the salesperson how the process will work for the property you are interested in.

In every instance, it's a good idea to research the property to determine the price that you're prepared to pay and make sure that you get your lawyer to check anything that you sign.

Usually, property sales in New Zealand fall into four different categories.

  • Advertised Price
  • Tender/Deadline Sale/Set date sale
  • By Negotiation
  • Auction

Advertised Price

An advertised price sale is where a property is marketed at an advertised price with no time limit. If you wish to make an offer, the real estate agent will get you to complete a sale and purchase agreement, or you can ask your lawyer to draw up an offer, which will be presented to the seller by the real estate agent. Normally your offer will be conditional – which means it is subject to conditions like your satisfaction with any building inspections or your ability to obtain a mortgage. Once you have negotiated all the terms and the price with the seller, reached an agreement and paid an agreed deposit, you are under contract. When all the conditions are met, your contract is declared unconditional by your solicitor. When settlement date arrives, you pay in full for the property and receive the keys.

Tender/Deadline Sale/Set date sale

When a property is sold by tender, it is not marketed with a price (although a minimum guideline price may be advertised). Buyers make confidential offers to the selling agent by a set date, and then the seller has a maximum of five days to decide which offer, if any, to accept. Sometimes a property may be advertised as “for sale by tender (unless sold prior)”, which means that it can be sold before the tender date.

If you make an offer on a tender, you will often need to pay a deposit at the same time, which is refunded if your tender is unsuccessful. Once the seller chooses an offer, the remainder of the process is the same as an advertised price sale.

By Negotiation

This is an alternative to advertising with a Price. By negotiation is a method of inviting buyers to make an offer without the seller disclosing what they will accept. This method also includes conditional offers.

Auction

An auction is an open process where buyers bid against one another to purchase a property. When buying at an auction, you are bidding unconditionally so you must have all your finance and research arranged beforehand. The seller will set a reserve price, and if bidding exceeds the reserve price during the auction, the property will be sold immediately to the highest bidder. If bidding fails to meet the reserve, the highest bidder may be invited to negotiate with the seller after the auction. Sometimes the seller may accept a pre-auction offer if the terms of the auction allow it.

READ AND UNDERSTAND THE SALE AND PURCHASE AGREEMENT

The sale and purchase agreement is a legal document, so it’s vital to read it carefully and to get legal advice before you sign. It contains the terms and conditions of the property sale, such as:

  • The price
  • Details of the buyer’s deposit
  • Any chattels included (like carpets and ovens)
  • The property title (i.e., freehold, leasehold)
  • Any conditions specified by the buyer or seller
  • Unconditional and settlement dates

It also contains clauses that outline the buyer’s and seller’s obligations and outlines what kind of penalties will apply if either party defaults on the agreement terms (e.g., delaying settlement).

You cannot change your mind once you have signed the agreement and all conditions have been met – you are legally committed to the purchase. Before you are asked to sign, the selling agent should give you a copy of the Real Estate Authority (REA) guide (which can be found here).

Do your own research
Do your own research

WORKING WITH THE REAL ESTATE AGENT

Remember, the agent selling the house is working for the seller. You can choose which agent you want to deal with from the selling agency, and it does not have to be the one who has listed the property.

Make sure that the agent you’re working with is licensed so that if anything goes wrong, you can call on the support of the REA. They publish a list of all licensed agents at rea.govt.nz, which contains details of any complaints upheld against an agent.

Remember to ask the selling agent any questions you want to know about the property. They are required by their Code of Professional Conduct and Client Care to deal fairly and honestly with all parties and are not allowed to withhold any information that might affect the sale. Any statements they make to you must be able to be backed up with evidence. They must also notify you in writing if they have any conflicts of interest.

Now that you know how the process works, check out our latest listings to find your next home.

Find out the current market value of your property with a FREE appraisal from RE/MAX Warkworth

If you are thinking of selling, renovating or refinancing, getting an estimate of your property’s current market value is a great place to start and will assist you in determining your equity position. Our experienced agents will give you an obligation-free assessment and answer any question you have, all at no cost to you.

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